Electricity Monthly Update

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Highlights: December 2017

A late-month cold snap in the Northeast sent wholesale natural gas prices to $54/MMBtu and wholesale electricity prices to $176/MWh in New England.

At times from December 27-31, over 30% of the power generation in ISONE came from oil-fired generators.

The Northeast saw its share of coal and natural gas consumption decrease at the expense of other fossil fuel. This occurred because the Northeast experienced an extended period of significantly cold temperatures at the end of December 2017.

Key indicators

Average U.S. monthly residential electricity bills declined in 2016

Contrary to a general upward trend over the past decade, average monthly electric bills for residential customer in the United States went down in 2015 and 2016. The average monthly bill in 2016 was $112.59, a decline of over 1% from $114.03 in 2015. The average bill in 2014 was $114.09.

Average monthly bills are calculated by dividing total annual U.S. residential electricity sales revenues by the number of customer accounts and then dividing by 12. U.S. average bills have declined in only four of the past eleven years. In three of those years (2011, 2012, and 2016) total revenues declined. In 2015, total revenues increased, but the average bill decreased. Average bills tend to increase when total revenues go up and decrease when the number of customer accounts goes up. The percentage increase in the number of customer accounts in 2015 was higher than the percentage increase in total revenues.

Average monthly residential electricity bills vary significantly by state. They tend to be higher in the south and along the east coast where summer air-conditioning loads are higher. Average bills tend to be lowest in the Rocky Mountain states, which have lower cooling loads.

South Carolina and Alabama had the highest average monthly residential bill in 2016, at $146. Both states have been in the top 10 since 2009. Four other states have average monthly bills more than $130: Connecticut ($142), Maryland ($142), Georgia ($131), and Hawaii ($139).

Average monthly electricity bills have been the lowest in New Mexico since 2012. The average monthly bill in New Mexico in 2016 was $76. The other states with the average monthly bills lower than $90 in 2016 were Utah ($83), Colorado ($84), Maine ($86), and Montana ($89).

The change in average monthly bills varies by state. In the past two years, four states and the District of Columbia had increases higher than 5% in their average monthly residential electricity bills: West Virginia (16.6%), Rhode Island (8.9%), Michigan (7.5%), the District of Columbia (7.5%), and Massachusetts (6.4%). These states all saw significant increases in their total revenues over the two-year period. Although two of these states (West Virginia and Massachusetts) saw decreases in their number of customer accounts over this period, the increase in revenues outweighed this decrease.

Seven states had decreases greater than 5% in their average monthly bills from 2014 to 2016: North Dakota (-6.3%), Louisiana (-6.3%), Texas (-7.5%), Nevada (-8.8%), Mississippi (-10.8%), New York (-11.8%), and Hawaii (which had the largest drop in average monthly bill at -26.1%). These states all saw a decline in total revenues over this period. The increases in number of customer accounts in each of these states were outweighed by the decreases in revenues.